Propane Industry Focuses on Market Development and Prepares to Join the National Energy Conversation in 2009

Washington, D.C. (December 12, 2008) — The Propane Education & Research Council (PERC), meeting last week in Houston, approved a budget for 2009 that reorganizes its work around developing new markets for propane and elevating propane in the national energy conversation.

The $46.1 million revenue budget reflects a commitment to increasing the demand for propane by developing new markets for it. Market development can include conducting market research and helping manufacturers develop and commercialize new propane-fueled products and introduce them to consumers, dealers, and propane industry members.

“The propane industry is developing new markets for our product because propane is ready right now to make a greater contribution to our nation’s energy security and environmental stewardship, and because consumers are demanding more access to cleaner, more efficient sources of energy,” said PERC President and CEO Roy Willis.

Highlights of the Approved 2009 PERC Budget

Revenues

$ 46,093,000

Expenditures

Administrative

$ 2,840,000

State Rebates

$ 9,035,000

National Energy Conversation Initiative

$ 6,200,000

PERC, NPGA, GPA Partnership Agreement

$ 1,571,000

Consumer Education

$ 11,200,000

Engine Fuel

$ 6,300,000

Research and Development

$ 4,930,000

Safety & Training

$ 3,161,000

Agriculture

$ 1,959,000

Industry Programs

$ 4,630,000

Other Expenses

$ 981,000

General Program Costs

$ 2,619,000

The Council created a new staff position, chief commercialization officer, to coordinate technology development efforts across several PERC mission and market areas, including engine fuel, research and development, agriculture, and residential.

Even as the Council put increased focus on building markets through technology development, it continued to put substantial resources toward supporting the industry’s core residential market. The downturn in the housing market and the rise of new opportunities in engine fuel and other segments led the Council to redirect some of its resources. “You’re still in the business of providing warmth, and that needs continued support, but now is also a time to capitalize on emerging markets,” said Ann Wiessner, account director with communications agency Colle+McVoy (Minneapolis, Minn.), during a report to the Council.

Also at the Houston meeting, the Council authorized staff to begin the research and planning program of the $6.2 million National Energy Conversation Initiative once the period for public comment on the proposed initiative ends December 22. The initiative is designed to raise public awareness of the role propane can have in tackling the nation’s energy and environmental challenges. “Increasing propane’s visibility among people who influence energy decisions serves many industry purposes, and the initiative will help shape an umbrella message that will complement the industry’s market development plans for housing, agriculture, engine fuels, etc., and lead to the sale of more gallons,” said Willis.

In a presentation to the Council, Rick Roldan, president and chief executive of the National Propane Gas Association (NPGA), said the energy debate that is taking shape now in Washington is the most significant development in energy policy in 20 years.

In other Council business:

The Council approved a project to help commercialize Climate Energy’s freewatt micro-CHP (combined heat and power) system, which combines a warm-air furnace and a generator driven by a propane-fueled engine. The system recovers waste heat created by the generator and uses it to warm the room. The commercialization project, to be carried out by PERC and several partners, will include field testing, demonstration, and marketing.

The Council approved funding, pending public comment, to support work associated with the partnership agreement between PERC, NPGA, and the Gas Processors Association (GPA). The agreement, now entering its third year, covers joint staffing of the Capital Action Program, crisis communication training, and coordination of the Certified Employee Training Program, among other initiatives.

Guest speaker Rusty Leftwich, chairman of the National Association of Home Builders’ Builder 20 Clubs and a homebuilder in Mt. Pleasant, Texas, offered an overview of the work of the Builder 20 Clubs, thanked the Council for its partnership with the group, and noted that he encourages its members to build with propane.

PERC’s mission area advisory committees — agriculture, consumer education, engine fuel, research and development, and safety and training — delivered reports to the Council on their work in 2008 and received approval for their operating budget requests for 2009.

The Council congratulated PERC’s new chief marketing officer, Kate Caskin, on her promotion from senior vice president. She joined PERC in 1998.The Council approved funding for the following grants: